Do you ever look around when you go shopping and stop to think just how much has changed in the last 15-20 years? Last week I was shopping with a friend, and I noticed how most of the shoppers where multi-tasking, heads in their phones whilst they looked around at what was on offer – receiving geofenced ads, finding items they’d seen on a blog, or like my friend in question, looking at the item in store before going online to buy – I know. Who even does that?

So, what are they all looking at?

With 51% of Millennials stating that user-generated content (UGC) from strangers is more likely to influence their purchasing decisions than recommendations from friends, family and colleagues and 84% stating that UGC from a stranger has at least some influence on what they buy, UGC has never been more important. This is reinforced by the fact that large brands and retailers are starting to modify product information online so that items correlate with relevant and trending UGC, thereby using UGC as a medium to increase sales.

Hang on, what is user generated content?

User generated content (UGC), is anything that has been created by a consumer, brand advocate or fan. This can refer to videos, pictures, testimonials, tweets, blog post and anything else that is shared by citizens.

How is the retail industry harnessing the power of UGC?

According to Brandwatch there are currently 2.3 billion active social media users, this is almost one third of the world's population. Some of you may be wondering just how retailers can utilise the masses of UGC the 2.3 billion users generate.

In the book Descartes Error, Professor of Southern California states that 'emotions are one of the most significant ingredients to almost all buying decisions'.

A good place to start by looking at the psychology behind our purchasing habits:

Naturally suspicious – This has been evidenced over years and the fact we still have sales staff, who have to normally work extremely hard to close a sale, demonstrates our suspicious nature. Social media has provided a marketplace for consumers to share their experiences and convince buyers to spend their hard earned cash.

Emotional purchases – It doesn’t matter how rational you believe you are, as humans we are all influenced by emotions whether knowingly or subconsciously. We use all of our brain when making purchasing decisions, which means we're more inclined to make a purchase if the product has a positively incentivised program backing them or they're endorsed in someway by our favourite celebrities.

A staggering 93% of women who use social media said they purchased something because a blogger recommended it. Any recommendation plays an important part in expanding the target UGC audience by exploding the network of followers and volume of users who will see, and, most likely, engage with your product.

Harris Interactive found in their research that 71% of consumers say that reviews from friends and family members greatly influence their buying decisions. Although as recently proven by Amazon who have started to ban incentivised reviews, not every review is a trustworthy review.

Can a picture really say a thousand words?

Instagram, particularly in the retail sector, has put even further emphasis on the importance of pictures. Currently on an average day, 95 million photos and videos are shared across Instagram’s 500 million users.

Brands haven’t been walking round with their eyes closed as currently 48.8% of brands are using Instagram and if you took only the top 100 brands, 90% can be found on Instagram. Alongside this 70% of the most used hashtags are branded or campaign hashtags

At the time of writing this article, the Fetch team searched for a few hashtags on Instagram - this is how many times each has been used:

#Shopping - 52,491,704 times#shoppingspree - 257,435 times

With so much content being generated and shared. Is it time you harnessed and took advantage of all this free content at your fingertips?

Why does UGC work for retail?

User-generated content is extremely valuable in today’s retail industry because of the popularity of users on Snapchat, Instagram and Facebook, with 500 million people actively using Instagram each month and Snapchat quickly catching up with 310 million active users.

Snapchat is the latest social media platform to take over with 100 million daily active users, and savvy brands are already utilising Snapchat as part of their content marketing strategy.

Burberry is the oracle when it comes to brand Snapchat. Last year they ran a Snapchat campaign that was a 24-hour fashion campaign, shot by Mario Testino. The shots of Burberry’s Spring/Summer collection were only available to view for 24 hours before disappearing. This was an excellent way of playing on the fear of missing out (FOMO); creating an exclusive 24-hour window means you have to be in the right place at the right time.

The UGC created and shared across social media represents an opportunity for retailers to engage and effectively reach their potential customers by learning about their demands and interests. As the younger generation become key targets for retailers, engaging with them via social media will be a critical step to stay relevant and get key insights and understandings.

The younger buyers are obsessed with their smartphones, constantly surfing the Internet and social media, and generating huge amounts of content that is being shared across channels.

One of the turning points for UGC was Coke launching their bottles with named labels and running the ‘Share a Coke’ campaign using the hashtag #ShareaCoke.

Coca-Cola #ShareaCoke campaign

This campaign put Coke’s customers in the role of marketer, sharing and selling their brand directly to their friends and peers.

Here are some methods retailers can use to really utilise UGC:

Using UGC in store might be the difference between a sale and someone walking away.

Cleverly placed screens containing aggregated UGC, particularly photos, is a good way to increase conversion rates. It is even possible to launch a hashtag campaign alongside a new product launch, which can be seen in the image below showing what Samsung did over the Christmas period inside a shopping centre.

Live UGC feed on a Samsung screen

Once again this week, Burberry paved the way with their 24 hour Snapchat lens.

Burberry’s Lens let users see themselves beneath an umbrella. If they blow a kiss while on camera, this will trigger a golden light filtering effect, hoping that users would love the filter as much as we love the Golden Halo.

Burberry is driving users to its new Lens through Instagram, simply posting a picture of Snapchat's logo.

Clicking on the link pushes users to Snapchat, where they will find the new Lens.

Burberry’s new lens means they join a host of UK brands marketing on Snapchat, with Nationwide, EE and Virgin Media all sponsoring Lenses or filters on the platform in recent months - Snapchat is becoming an ever important platform to reach a younger audience.

Has UGC already impacted retail?

In short, yes. The retail sector has already been massively influenced by UGC and will continue to be, particularly for the younger audiences. More and more emphasis will be placed on UGC as brands put more of their budgets towards content creation and campaigns to create UGC.

Marc Jacobs recently ran a casting campaign through social media where participants had to post an image alongside the hashtag #CastMeMarc and within the first 24 hours there were 15,000 posts generated with this hashtag. This started the social media phenomenon now known as ‘selfie-casting’.

Cast Me Marc UGC campaign

This was utilising UGC in a different way but demonstrated how powerful it can be, taking advantage of something their target audience was already doing, which was taking a selfie.

Wrap up

By putting all of your social feeds in one place on a website, either a dedicated campaign microsite or your main website people get a view of what is going on with your brand. This can be useful to gain customer insights that otherwise would not know. It can help manage your reputation and brand image and used correctly, it will drive traffic to your site.

With content becoming more important than ever, social media and blogging have become key methods for brands to increase UGC levels. It is cheaper for you to get users to generate content, than having to spend hours creating it yourself.

There is a big opportunity through the use of UGC in combination with analytics to uncover your biggest influencers and brand evangelists. Being able to uncover these two groups of people will allow you to engage with them and harness the influence they have across social media and blogging.

UGC is growing in importance for all brands but in particular those in the retail industry. The power of UGC has been seen time and time again. There is little doubt as we head through 2016 and in to 2017 we will see more and more UGC being harnessed by brands, starting to utilise the power their audiences have over other consumers.

If you want to improve your UGC strategy these are the top 3 things you should consider:

Conversion – don’t forget conversion is a two way process, you need to work with your customers to increase your conversion rates.

Choose an appropriate hashtag – there is nothing worse than a hashtag that uses too many characters or doesn’t make sense when compared to the message. Ensure your hashtag is appropriate for all platforms and check it is not already being used.

Where you display your social feeds – are you displaying all of your social feeds in one place on your website? If not this would be a great place to start.

Do you want to learn how you can integrate UGC in to your marketing strategy? Contact us today to explore the possibilities for your brand!